Knobias Clip Report (03-06-2008)
Submitted By Knobias ClipReport
TASR: Stun Gun, CAM Orders Piling Up for TASER
Despite a seemingly endless flow of product liability lawsuits, ongoing litigation battles with rival Stinger Systems (OTCBB: STIY), and some unease among the public regarding law enforcement’s use of stun guns in general, orders continue to mount for TASER International (NASDAQ: TASR).
The Company (NASDAQ:TASR) announced on Thursday that it has received two more large orders from law enforcement agencies. Financial terms of the deals were not disclosed, but the orders were for a total of 365 X26(tm) Electronic Control Devices and two TASER(r) CAM(tm) audio/visual recording systems and related accessories.
Shares of TASER were trading down about 1% during the early session, albeit it should be noted the Dow Jones Industrial Average was down triple digits around the same time.
According to Thursday’s press release, the first order was received from the Suffolk County Police Department, in Yaphank, NY, for 225 X26 ECD’s. The second order was from the North Dakota Highway Patrol in Bismarck, ND, for 140 X26 ECDs plus the two aforementioned recording systems.
CEO Tom Smith stated in the release, “The Suffolk County purchase is a follow-on order adding 225 TASER X26 ECDs to their previous existing inventory of 30 TASER X26 units. We also welcome the North Dakota Highway Patrol as a new client among a growing field of 21 state police agencies choosing our equipment to protect life.”
Thursday’s news adds to an eventful period for the Company in the last few weeks. TASER announced early last month that it had received a large order for 3,000 M26(tm) ECD’s from the interior ministry of a foreign country. Global business is of course important to the Company, but more significance could possibly be placed on the sheer size of the request. In an interview aired later the same day on CNBC, Smith said that a typical order only averages 10 to 20 units.
The Indianapolis Metropolitan Police Department and the North Carolina Crime Control (Highway Patrol) followed suit a few days later with X26(tm) ECD follow-on orders of 394 and 250, respectively.
Then, last week, TASER announced that the Company had received two additional orders. The first of which, from the Los Angeles Port Police, was for 180 X26(tm) ECD’s. The second, from the Doral Police Department in Doral, FL, was for 100 X26(tm) ECDs, plus 100 TASER CAM(tm) systems and related accessories.
Specifically regarding the TASER CAM Product, the Company claimed in a separate press release two days prior that the device was instrumental in clearing Siskiyou County, CA Sherriff Deputies of any wrongdoing in a recent court case. District Attorney Kirk Andrus was reported to have said that the “most compelling evidence” was the digital and audio footage. Mr. Smith added, “Recently, the TASER CAM system proved invaluable in terms of providing key evidence in a police shooting in California.”
In addition to the Siskiyou County case, three other liability lawsuits involving the Company itself were dismissed during February as well. Fernandez v. TASER International, Inc., LeBlanc v. TASER International, Inc., and Moreno, et al. v. TASER International, Inc. were all dismissed with prejudice.
TASER provides advanced Electronic Control Devices (ECDs) for use in the law enforcement, medical, military, corrections, professional security, and personal protection markets. TASER devices use proprietary technology to incapacitate dangerous, combative, or high-risk subjects who pose a risk to law enforcement officers, innocent citizens, or themselves in a manner that is generally recognized as a safer alternative to other uses of force.
All of the Company’s recent orders are expected to ship in the current fiscal quarter. TASER has posted TTM revenues of $100.7 million with a net margin of 14.92%. In the Company’s latest earnings release, TASER reported Q4 EPS of 7 cents and 23 cents for the full year. The results were consistent with consensus estimates.
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